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Top performing pension returns 29% p.a.

Mark Bridge

September 19 2011, 1:54pm, The Times

Standard LifeJames Glossop for The Times

Unit-linked funds are outperforming with-profits and balanced managed funds as underlying investments in personal pensions, according to new research. The study from Money Management magazine indicates that the top unit-linked pension plan has returned 29 per cent a year over five years after basic rate tax and charges.

The best-performing fund in the category, Standard Life’s UK Smaller Companies fund, returned £19,281 on gross contributions of £200 a month (a total investment of £12,000), providing an annual growth rate (AGR) of 19 per cent.

After basic rate tax relief, however, the fund returned an AGR of 28.8 per cent.

The figures before tax relief compare with a return of £15,388 and AGR of 9.9 per cent from the top balanced managed fund from Axa/Baillie Gifford.…